Church Contributions and Contributions to Churches

Ron Bolin: Dec. 16, 2014
Religion plays an important part in the life of communities and its role has been legislated into our economic life as well. Recent events had brought this to my attention as events have uncovered some holes in the legislation which, to my way of thinking, cast doubt on integrity of the connection between our religious and our secular life as a community.

Last year the roof literally fell in at 91 Chapel Street, part of which was registered as a church/place of worship, demonstrating that it was not only unfit to perform the role for which a tax exemption was granted, but that it had no doubt been in an unusable condition for some time. Nevertheless, this property was registered for both the mandatory provincial property tax exemption (on the building and the land immediately beneath it). Its assessed value in 2013, the year the roof collapsed, was $783,000 with a tax exemption of $423,000. The structure on the property was assessed at $10,000 and granted a full exemption.

A few days ago the property at 2992 104th Street came before Council for a rezoning to a small lot subdivision. City records show that the land and improvements were assessed at $397,400 in 2014. Tax on both were exempted so that the property paid no tax, even though it appears as though the “church” structure has not been used for public worship for many years. Indeed, the assessment of the structure on the property is considerably less than the 25% of the land value and thus has been eligible for involuntary demolition by the City for some time. This path has recently been taken on a number of derelict or semi derelict properties in Nanaimo.

Again in this case, and for an unknown number of years, the property taxes which were not paid by the religious owners of this property have had to be made up by other taxpayers.

Several questions arise from these examples:

First, who is minding the store? Who determines whether any structure owned by a religious organization is used as a place of worship in any part or all of any tax year? Who monitors this on behalf of the taxpayers of Nanaimo? How much are taxpayers providing for religion? My inquiries have led to fingers pointing back and forth between the City and BC Assessment in this regard. It seems that there are neither annual papers to be filed nor any annual inspections.

Second, why, in this day and age, should permissive tax exemptions be automatically given by any municipality to any religious organization, regardless of its contribution to the community at large? If the citizens of any municipality wish to provide property tax exemptions for religious organizations, perhaps it should be for the charitable service to the community which they provide rather than simply for existing. There are a number of charitable organizations which are given property tax exemptions for their service to the community and it would not be amiss for churches/religious organizations to apply for such status indicating the service which they provide.

Find below the legislation dealing with church/religious exemptions

Provincial Legislation (from the Community Charter)

Division 6 — Statutory ExemptionsGeneral statutory exemptions

220 (1) Unless otherwise provided in this Act or the Local Government Act, the following property is exempt from taxation to the extent indicated:

(h) a building set apart for public worship, and the land on which the building stands, if title to the land is registered in the name of

(i) the religious organization using the building,

(ii) trustees for the use of that organization, or

(iii) a religious organization granting a lease of the building and land to be used solely for public worship;

224 (1) A council may, by bylaw in accordance with this section, exempt land or improvements, or both, referred to in subsection (2) from taxation under section 197 (1) (a) [municipal property taxes], to the extent, for the period and subject to the conditions provided in the bylaw.

(2) Tax exemptions may be provided under this section for the following:

(f) in relation to property that is exempt under section 220 (1) (h) [buildings for public worship],

(i) an area of land surrounding the exempt building,

(ii) a hall that the council considers is necessary to the exempt building and the land on which the hall stands, and

(iii) an area of land surrounding a hall that is exempt under subparagraph (ii);

(g) land or improvements used or occupied by a religious organization, as tenant or licensee, for the purpose of public worship or for the purposes of a hall that the council considers is necessary to land or improvements so used or occupied;

City of Nanaimo Bylaw (City Bylaws)
TITLE

1. This Bylaw may be cited as the “PROPERTY TAX EXEMPTION BYLAW 2014 NO. 7201”.

CHURCHES

2. Subject to Section 3 of this Bylaw, the Church lands, together with the buildings thereon, listed on the attached Schedule ‘A’ and further clarified in Maps ‘A-1’ to ‘A-10’, shall be exempt from taxation.

3. Church halls situated upon lands described in Schedule ‘A’ of this Bylaw, whether such halls are within church buildings or apart there from, are deemed to be necessary to their respective church operations.

4. The maximum area of land to be exempted from taxation shall be 2.0 acres (87,120 sq. ft.) of the land upon which the buildings for public worship stand plus the footprint of the building(s) used for public worship. This exempted area will not exceed the land area of the legal parcel(s) upon which these buildings stand.

Your comments on this touchy topic are invited.

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6 Comments

You seem to be suggesting that church groups with a building in decline should lose their tax exemption. That would hasten the end of the church. If the purpose of your suggestion is to raise more money there are other property tax loopholes favoring theland developers who seem to be the puppet masters for our provincial government. An example is the developer’s sales centre that is tax exempt (according to info provided to me by staff at BC Assessment).

Deryk: The question is not whether the building is in decline. I guess all buildings are as soon as construction is completed. The first question is whether the state of the building supports the purported use as a place of worship, thus making it eligible for the exemption. And second whether any property should be granted an exemption when it is solely used by a group for its own purposes.

My only point is that when a group supports its own purposes alone, that it should not be subsidized by all. This does not exclude considerations of a number of other areas where all taxpayers are called upon to subsidize something which is of benefit to a special interest.

I would be interested in the example you give. Please follow up to determine whether you are correct in your assertion. I suspect that there are a number of similar subsidies from the public purse out there and look forward to hearing about them from readers.

I’ve long believed in the “user pay” principal when it comes to the use of public facilities and believe that churches and church property should not be tax exempt. Let the respective parishioners cough-up the funds necessary to have church property pay their fair share of taxes.

In this same vein, it was recently reported that the Bethlehem Retreat Centre was up for sale as the operators of religious institution were ready for retirement. The land was assessed at $777,100 ($660,400 exempted) and the improvements were assessed at $971,200 ($138,200 exempted). The property was reported listed at $2.8 million dollars, providing a retirement fund for the sisters. The extent to which the sale of the property may affect or be affected by the exemption is unknown.

Regarding properties such as 61 Chapel Street that have been granted exemption from property tax, on the basis of them being a place of worship:

Who should be held accountable for confirming and monitoring whether such a property is in fact being used for such a purpose, and indeed is in a suitable state of repair for being used for such a purpose?

Who should submit claims on behalf of Nanaimo’s taxpayers, for property taxes owed because of fraudulently-claimed tax exemptions?

Such property tax payments should be backdated to the earlier of:

when the tax- exempt portion of the building ceased to be used as a place of worship

when the tax-exempt portion of the building ceased to be in a suitable state of repair to be used as place of worship

THIS is just one example of how City Hall should be raising operating funds, not just flippantly raising property taxes for the general taxpayer!